ROMI S.A. 2Q21 Earnings Release
July 20, 2021
June 30, 2021 | |||
Share price at 7/19/2021 | Earnings Conference Call broadcast over the web in Portuguese, with | ||
ROMI3 - R$23.40 per share | |||
simultaneous translation into English | |||
Market value | July 20, 2021 | ||
11a.m. (São Paulo) | 2 p.m. (London) | 9 a.m. (New York) | |||
R$1,716 million | |||
US$326.8 million | https://us02web.zoom.us/webinar/register/WN_UbhivmkeTOO1qLBIBicuXw | ||
Number of shares | Zoom ID: 875 7231 7357 | ||
Common: 73,333,922 | Dial-in number: +55 (11) 4680- | 6788 | |
Total: 73,333,922 | |||
Dial-innumbers at https://us02web.zoom.us/u/kszWE5ZfN | |||
Free float = 50.8% |
Earnings Release
2nd quarter of 2021
Santa Bárbara d'Oeste - São Paulo, June 30, 2021
Indústrias Romi S.A. ("Romi" or "Company") (B3: ROMI3), domestic market leader in the Machine Tools and Plastic Processing Machines markets, as well as an important producer of Rough and Machined Cast Iron Parts, announces its results for the second quarter of 2021 ("2Q21"). Except where otherwise stated, the Company's operating and financial information is presented on a consolidated basis, in accordance with the International Financial Reporting Standards (IFRS).
Statements contained in this release related to Romi's business outlook, projections of operating and financial results and references to the Company's growth potential are mere forecasts and have been based on Management's expectations regarding its future performance. These expectations are highly dependent upon market behavior, the economic situation in Brazil, the industry and international markets. Therefore, they are subject to changes.
Investor Relations Contact
Fábio B. Taiar
Investor Relations Officer +55 (19) 3455-9418dri@romi.com
Highlights
EBITDA in 2Q21 was R$66.5M (+245.9% over 2Q20);
Incoming orders of R$365.2M in 2Q21 (+100.2% over 2Q20);
Order backlog reaches R$674.8M at the end of 2Q21 (+68.5% over 2Q20)
- Consolidated net operating revenue for 2Q21 reached R$351.4 million, an increase of 79.3% compared to 2Q20. With the increase in revenue and the effective control over costs and expenses, EBITDA, in 2Q21 posted a growth of 245.9% compared to 2Q20;
- At the Romi Machines Unit, net operating revenue increased by 153.1% in 2Q21 compared to 2Q20, due to the resumption of orders from June 2020 and more recently of the foreign market. The increase in revenue, coupled with an effective control over operating expenses, resulted in a 15.5 p.p. expansion in operating margin compared to 2Q20;
- At the Rough and Machined Cast Iron Parts Unit, net operating revenue increased by 102.9% in 2Q21 compared to 2Q20, with the continuity of deliveries of large parts and the recovery of the other segments. Operating margin grew by 6.8 p.p., reflecting the higher production volume and improved operational efficiency;
- Incoming orders at the Romi Machines Unit increased by 100.4% in 2Q21 compared to 2Q20, reflecting the highly favorable environment for investments, the technology in our products and the new business alternatives, such as the machine rental business;
- In 2Q21, incoming orders at the Rough and Machined Cast Iron Parts Unit increased by 63.4% compared to 2Q20, reflecting the continuity of orders for large parts placed by customers from the energy industry and the recovery of all the other industrial segments;
In 2021, incoming orders at the Burkhardt+Weber Unit reached R$80.2 million, an increase of 297.6% compared to 2020, reflecting the resumption of projects that had been suspended due to the COVID-19 pandemic;
- At the end of 2Q21, the Company's order backlog grew by 68.8% in comparison to 2Q20.
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Earnings Release
2nd quarter of 2021
Quarterly | Acumulated | |||||||
R$'000 | 2Q20 | 1Q21 | 2Q21 | Var. | Var. | 1Q20 | 1Q21 | Var. |
Revenues Volume | 2Q21/1Q21 | 2Q21/2Q20 | 2021/2020 | |||||
Romi Machines (units) | 137 | 219 | 332 | 52% | 142% | 301 | 551 | 83.1% |
Burkhardt+Weber (units) | 5 | - | 5 | 0% | 0% | 8 | 5 | -37.5% |
Rough and Machined Cast Iron Parts (tons) | 4,263 | 5,808 | 7,329 | 26% | 72% | 8,359 | 13,137 | 57.2% |
Net Operating Revenue | 196,012 | 222,630 | 351,459 | 57.9% | 79.3% | 361,953 | 574,089 | 58.6% |
Gross margin (%) | 28.1% | 33.9% | 0.0% | 28.5% | 23.4% | |||
Operating Income (EBIT) | 10,300 | 25,375 | 56,045 | 120.9% | 444.1% | 15,014 | 81,420 | 442.3% |
Operating margin (%) | 5.3% | 11.4% | 15.9% | 4.1% | 14.2% | |||
Operating Income (EBIT) - adjusted (*) | 10,300 | 25,375 | 56,045 | 120.9% | 444.1% | 15,969 | 81,420 | 409.9% |
Operating margin (%) - adjusted (*) | 5.3% | 11.4% | 15.9% | 4.4% | 14.2% | |||
Net Income | 11,359 | 20,744 | 42,819 | 106.4% | 277.0% | 52,176 | 63,563 | 21.8% |
Net margin (%) | 5.8% | 9.3% | 12.2% | 14.4% | 11.1% | |||
Net Income - adjusted (*) | 11,359 | 20,744 | 42,819 | 106.4% | 277.0% | 17,202 | 63,563 | 269.5% |
Net margin (%) - adjusted (*) | 5.8% | 9.3% | 12.2% | 4.8% | 11.1% | |||
EBITDA | 19,221 | 35,429 | 66,486 | 87.7% | 245.9% | 32,492 | 101,915 | 213.7% |
EBITDA margin (%) | 9.8% | 15.9% | 18.9% | 9.0% | 17.8% | |||
EBITDA - adjusted (*) | 19,221 | 35,429 | 66,486 | 87.7% | 245.9% | 33,447 | 101,915 | 204.7% |
EBITDA margin (%) - adjusted (*) | 9.8% | 15.9% | 18.9% | 9.2% | 17.8% | |||
Investments | 3,351 | 18,310 | 19,408 | 6.0% | 479.2% | 9,667 | 37,718 | 290.2% |
EBITDA = Earnings before interest, taxes, depreciation and amortization.
- Of the investments made in 2Q21 and 1Q21, R$11.9 million and R$7.5 million, respectively, refer to machines manufactured by the Company that were allocated to the machinery rental business, a new solution launched in 3Q20.
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Earnings Release
2nd quarter of 2021
Corporate Profile
Romi, founded in 1930, is the leader in the Brazilian industrial machinery and equipment market, and an important manufacturer of rough and machined cast iron parts.
The Company is listed on B3's "New Market", which is reserved for companies with a higher level of corporate governance. Romi manufactures machine tools (Conventional Lathes, Computerized Numerical Control (CNC) Lathes, Lathing Centers, Machining Centers, Vertical and Horizontal Heavy and Extra-Heavy Lathes and Drilling Mills), Plastic Injection or Blow Molding Machines and ductile or CDI gray cast iron parts, either in raw or machined form. The Company's cutting-edge products and services, which feature Industry
4.0 technologies, enable the smart use of the data generated, whether through built-in artificial intelligence or through the transfer of big data over the networks (connectivity) to a central analysis site. The Company's equipment is sold all globally and used by a number of industrial segments, such as the agricultural machinery, capital goods, consumer goods, packaging, tooling, hydraulic equipment, sanitation, automotive and wind power industries, among many others.
The Company has thirteen manufacturing units, four of which for final assembly of industrial machinery, two foundries, four units for machining of mechanical components, two units for manufacture of steel sheet components, and a unit for assembly of electronic panels. Of these, eleven are located in Brazil and two in Germany. The Company has an installed production capacity of approximately 2,900 industrial machines and 50,000 thousand metric tons of castings per year.
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Earnings Release
2nd quarter of 2021
Current Economic Scenario
2021 continues to show a favorable environment for investments, as started in mid-2020. This important recovery in turnover can be seen mainly in the incoming orders for Romi machines. The current interest rates, as well as the exchange rate level stimulates the domestic industry and Brazil in general to allocate a larger share of capital to the productive economy, seeking increased productivity and the preservation of competitiveness. In view of the more concrete signs of this resumption that took place in 2020, the Company prepared itself, especially in relation to orders for raw materials and components along the supply chain, which have allowed us to serve customers in an appropriate and competitive period. Romi is prepared to continue to support its customers by providing high-technology products, within deadlines suitable to the market's needs.
In the foreign market, we have also noted a gradual resumption of machine orders, for machines produced by both Romi and by B+W, and the latter already completed major orders in 4Q20 and in the first half of 2021, as may be seen in the incoming orders reported for these quarters. These orders reflect the growing volume of opportunities, particularly in Asia, although Europe is already showing stronger signs of recovery.
The Industrial Entrepreneur Confidence Index (ICEI) also shows a strong recovery of confidence throughout the first half of 2021, and in recent months this index remained stable at a level considered highly favorable for new investments.
Industrial Entrepreneur Confidence Index - ICEI
Source: CNI - ICEI, July 2021
The Installed Capacity Utilization (UCI) index of the domestic industry in general, released by the National Confederation of Industries (CNI), which has been impacted by the COVID-19 pandemic, returned to its normal levels in August 2020. With the increase in COVID cases at the beginning of 2021, this index has shown greater volatility, however, it remains at levels favorable to investments.
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Indústrias Romi SA published this content on 20 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 20 July 2021 22:37:02 UTC.
